Kemi Badenoch accused Labor of crushing the hospitality industry and killing High Streets as she unleashed fresh assault on the Budget. The Tory leader blasted Rachel Reeves and Sir Keir Starmer as hotel bosses warned they are at “breaking point” after being clobbered with a monster 182% rise in business rates.
Mrs. Badenoch warned that many businesses will struggle to survive because they are being strangled by higher taxes and the government's pointless rules and red tape. She hit out as new analysis revealed that some hotels have had eye-watering business rate hikes of more than £100,000.
The Chancellor confirmed last week that a new business rates system will be introduced from April.
This will see rates multipliers lowered for retail, hospitality and leisure firms – funded by higher rates on larger commercial properties, including warehouses.
It also means that businesses with larger premises, like storage companies and supermarkets, will be hit with a property tax rise.
The Treasury said the move was designed to “rebalance the business rates system” and help smaller firms by putting more of the tax burden onto bigger operators.
But Tim Rumney, CEO of Best Western Hotels GB, has warned the tax raid has left the hotel sector “fighting for its life.”
He said: “The detail that followed the Chancellor's Budget last week has exposed just how detached government policy has become from the reality facing Britain's independent hotels.
“What was presented as support for business is, in truth, a disproportionate tax raid on a sector already fighting for its life.”
He said the withdrawal of the 40% business rates relief for hospitality – combined with a “token” 5p reduction in the multiplier – amounts to a direct and significant tax rise.
In the most shocking case, a hotelier in Wales reported a massive 182% increase in rates – from £63,500 to £179,000, according to analysis by BWH.
In the North West, one BWH member faced a 17% rise, from £155,000 to £181,000 while another, in the Midlands, saw a 23% uplift, from £54,000 to £66,500.
One Yorkshire hotel is facing a bill rise from £55,777 to £117,700, a 111% jump.
Mr Rumney added: “For thousands of independent hoteliers across the country, this is nothing short of a stealth tax increase that will push many to breaking point.
“Independent hotels are the backbone of Britain's regional tourism and local economies and they are being confronted with soaring operating costs, persistent staffing pressures and now punitive property revaluations that bear little resemblance to trading performance.”
He warned the impact of the rate changes could see many hotels becoming another “boarded-up building in a declining town centre.”
Mrs Badenoch told the Daily Express: “Keir Starmer and Rachel Reeves act like they're on a mission to crush the UK hospitality industry.
“First it was the Jobs Tax making it more expensive to hire workers. Then the Employment Rights Bill loading up new onerous rules and red tape. Now they've withdrawn business rates relief, which will be a further hit to the small margins hospitality businesses work with.”
Last month we revealed how Mrs Badenoch promised to kickstart a high street boom by pledging to abolish business rates for 250,000 retailers and boosting police numbers.
Her bold blueprint, if the Tories win the next general election, also includes slashing energy costs and cutting red tape to help shops flourish.
The Conservative leader added: “While Labor seems intent on killing our high streets, the Conservatives are determined to revive them.”
Sir Keir was forced to defend the government's business rates policy during Prime Minister's Questions on Wednesday.
Asked by Lib Dem MP Liz Jarvis if he would look again at an emergency cut on VAT for hospitality, the PM said: “We have put in place a strategy for small businesses, which was broadly welcomed by small businesses because they contributed to it.
“And that involves some of the key asks that they made of us, including late payment and for hospitality, greater flexibility when it comes to licensing.”
The Daily Express Save Our High Streets Crusade has endeavored to help protect the country's cherished and vital town centres.
But the Budget has also been a hammerblow to already struggling pubs.
Emma McClarkin, CEO the British Beer and Pub Association, said: “This Budget fell dramatically short, leaving a sector that was already burdened with corrosive rates and taxes feeling even more distressed and undervalued.”
“For many, bills will rise rather than fall, despite the impression the Budget tried to give.”
Kate Nicholls, Chair of UKHospitality, said: “The Government promised in its manifesto that it would level the playing field between the high street and online giants. The plan in the Budget to achieve this is quickly unravelling, and will deliver the exact opposite.
“Our analysis shows that hospitality businesses will be paying more. Pubs will see bills increase by thousands and hotels by tens of thousands.”
During PMQs Mrs Badenoch savaged the Prime Minister for using the Budget to “save his own skin”.
She also took aim at the Chancellor, saying she should be in “La la Land” not the Treasury after revelations emerged suggesting she inflated her childhood chess success.